Question re: Fibre optic link - May 13, 2014

Mr. Silver: With regard to a second fibre optic link to the south through Juneau, yesterday the Minister of Economic Development said — and I quote: “I am committed to this project.”

Last year, the government awarded, without competition, a contract to a company to look into this project and that report recommended — and I quote: “that a privately owned company be established to implement a Whitehorse–Juneau fibre optic link with connections to Seattle as well as offer wholesale data and internet services in Whitehorse. The company will require a one-time grant of at least $12.8 Million to cover half of the startup costs and enable a viable business plan. The business plan assumes funding from both public and private sources, capacity sharing agreements with Northwestel, and a 10 year commitment from the Government of Yukon to purchase connection capacity from the new company.”

How does this plan for a $13-million subsidy to start a new company fulfill the Yukon Party’s commitment to maintain a level playing field in supporting small businesses?

Hon. Mr. Dixon: I have to correct the member opposite. He is wrong in his statement that this was somehow sole sourced or done without competition. This was a funding of a First Nation conglomerate of development corporations to conduct a study. We provided funding to this group of First Nation development corporations to conduct the study in question. He correctly quotes from that executive summary, which is now available.

We appreciate the work that was done there. We have taken that report into consideration. That particular vision, as articulated in that feasibility study, may be an option, but it’s not one that we have prioritized. While we appreciate the work that has been done in determining the feasibility of that project, and the work that has been done to date by the three First Nation development corporations, we are exploring a number of different options for the development of this project. We’ve included about $600,000 in the budget for this particular project to advance the business planning, and we’ll be moving forward with the development of this project in the near future. As I’ve said before, we haven’t come to a decision as to the exact business model that we’ll be employing yet. While we appreciate the work done on that feasibility study — and it will be taken into consideration — that’s certainly doesn’t limit our options when it comes to the development of a business plan.

He is wrong in continuing to assert that this was done without competition. This was a specific funding allocation to a group of aboriginal development corporations to conduct a feasibility study, and that’s it.

Mr. Silver: The only thing that he missed was “without competition”.

Mr. Speaker, last year the Yukon Party paid $120,000 for a report and called for it to get into the fibre optic business and the Internet business. The report recommended that the government, the taxpayers, provide a one-time grant for at least $12.8 million to a new private company to establish a Whitehorse-Juneau fibre optic link. The minister said yesterday that he is committed to this project. The Yukon Party campaigned on a promise to maintain a level playing field in supporting small business.

This year, the government has set aside another $600,000 to pursue this idea. Why does the minister think that taxpayers should be funding competition to Northwestel to the tune of a $12.8-million subsidy?

Hon. Mr. Dixon: Quite frankly, the member is wrong, and I don’t think that we should be providing $12.8 million to provide competition to Northwestel, as he has indicated. As I said before, we provided funding to a group of aboriginal development corporations — First Nation development corporations — to conduct a feasibility study. They did that feasibility study. It’s completed and it’s interesting information. We appreciate the work that was done to date. We’ve taken it into consideration, we’ve read it, we’ve considered it, and it’s not a model that we will be pursuing.

I am not interested in entering into competition or having government become a competitor to a telecommunications company in Yukon. However, I am interested in the development of a new fibre line to the south. We believe that providing redundancy, increased capacity and downward pressure on rates and improving affordability will be a good thing for Yukon’s economy and will be a good thing for the development of small and large businesses throughout our economy. I think this is important infrastructure that could see an effect on the diversification of our economy, and I look forward to advancing it.

When he asks if I am committed to this project — absolutely I am committed to the project. I want to see a fibre optic cable to the south that provides that redundancy, capacity and affordability for Yukoners.

The member opposite is going to have to get his mind around this. This is his interpretation, and his continued mischaracterization of these facts is not helpful for this debate.

Mr. Silver: For the record, the Liberal caucus supports a second fibre optic link. We also are prepared to support public investment in seeing that link established. What we are not prepared to support is the government picking winners and losers and funnelling money directly to one company or another in this endeavour.

Unfortunately, this is the model that the Yukon government is following, based upon the $120,000 report on its website. There is a further $600,000 in this year’s budget to continue working on this project.

The question is: Will the money be given directly to one company, or will there be a level playing field in which everyone interested is allowed to bid?

Hon. Mr. Dixon: The problem with scripted questions is that they don’t require consideration of the answers that were given. It is an interesting approach from the Liberal leader here.

What he did not do is listen to my answer. What I have said is that we provided $600,000 in the budget for the development of a business plan for the creation of a second fibre link to the south. That is what we plan to do. That is what we are committed to, and we believe that there is a role for the public purse to invest in infrastructure of this nature. For hundreds of years, governments have invested in roads and rails and ports and airports to advance their economies.

In the 21st century, things have changed and now we have a more digital economy. It is appropriate now for the public to invest in this sort of digital highway in the manner that previous governments did for the physical highways.

We’re committed to this project. We think it’s going to be transformational for Yukon’s economy. We think it’s going to introduce diversification that doesn’t exist currently, and we’re going to see a tremendous benefit for Yukon businesses, both small and large, as they hopefully see the creation of redundancy, affordability and increased capacity.

I encourage the member to pay attention to what I’m saying, to listen to it, and to stop mischaracterizing the facts — he has done so repeatedly over the past number of weeks — with regard to this particular project.